Energy transition still means billions in fossil-fuel investment

The energy crisis triggered by Russia’s invasion of Ukraine is increasing the world’s motivation to shift to low-carbon energy, but is also creating a near-term scramble for fossil fuels that will drive billions of dollars of new investment.

The U.S. and European countries are planning liquefied natural gas terminals that will be in service for decades. Coal demand is surging around the world and U.S. shale suppliers will be pressed to fill a potential supply gap for nations moving away from Russian natural gas.

The challenge for the world will be pivoting to cleaner technologies while also meeting current energy demand, executives and investors said Tuesday at BloombergNEF’s annual summit in New York. The transition is going to be bumpy, and it’s not going to happen quickly.

“We need fossil energy as part of this transition,” said Keo Lukefahr, head of energy derivatives and renewables trading at Motiva Enterprises LLC. “This is a long transition. This is not overnight.”

The gas market has been upended as nations seek alternatives to Russia, especially in Europe. However, current global output won’t be enough and that’s going to drive investment in new production, especially in the U.S. shale patch, Anastacia Davies, BNEF’s head of oil supply and U.S. oil said at the conference. 

“The days of unchecked U.S. growth are likely behind us,” she said. “But that doesn’t mean that shale’s role is gone.”

The war may also help accelerate the green transition, said Bertrand Millot of Caisse de Depot et Placement du Quebec, Canada’s second-largest pension fund manager. 

Countries are suddenly sensitive to energy security concerns, and are seeing the advantage of wind and solar farms that don’t require regular deliveries of fuel.

Guyana Oil Plan

Guyana has substantial oil reserves and is positioning itself to benefit from the crisis. It’s considering channeling resources into a national oil company to facilitate efforts to meet demand from industrialized nations, while also seeking to pursue climate goals.

“Demand for our resources is largely from the developed world,” said Bharrat Jagdeo, Guyana’s vice president, at the summit. “We don’t believe we are betraying a net-zero goal if we develop these resources,” 

That’s hardly a universal view.

Justin Guay, director of global climate strategy for the climate-justice organization Sunrise Project, said some energy companies are cynically taking advantage of the current European energy crisis by planning costly infrastructure projects that will take years to complete and won’t address short-term needs.

“It takes three to five years to build a new LNG terminal,” he said. “Europe needs a new gas supply by the end of the year.”

But, while the Ukraine war has focused a spotlight on the global reliance on fossil fuels, it’s also identifying ways to get away from traditional energy sources.

“When everything is in chaos, it’s good to think about the job to be done,” said Jon Moore, the head of BNEF.

Warner Bros Discovery to shut down CNN+ a month after launch

The service, which eclipsed 100,000 subscribers in its first week, succumbed to cost cutting by the firm’s new bosses.

CNN+ offers a mix of lifestyle shows and traditional news, including a daily interview show from Chris Wallace and a food and travel show hosted by actress Eva Longoria [File: Bloomberg]

By Gerry SmithBloomberg

Published On 21 Apr 202221 Apr 2022

Warner Bros. Discovery Inc. is shutting down CNN+ after just a few weeks, as the company’s new leaders reassess their online strategy and look to cut costs following their big merger.

The service will cease operations on April 30, according to an emailed statement Thursday. Customers will receive prorated refunds of their subscription fees end of list

Andrew Morse, who led CNN+, will leave after a transition period. Alex MacCallum, general manager of the service, will now run the network’s digital operations.

Discovery Inc. completed its merger with AT&T Inc.’s media business earlier this month. Management, including Chief Executive Officer David Zaslav, has said they are considering combining the company’s online offerings, which include HBO Max and Discovery+, into one subscription for consumers. CNN+ was championed internally by Jeff Zucker, the longtime media executive who stepped down in February.

“Our customers and CNN will be best served with a simpler streaming choice,” Chris Licht, the new CEO of CNN, said in the statement.

CNN+ offered a mix of lifestyle shows and traditional news, including a daily interview program from Chris Wallace and a food and travel series hosted by actress Eva Longoria. The company charged $5.99 a month for the product, the same as Fox News’ paid streaming service.

Bloomberg News reported earlier this month that the service topped 100,000 subscribers in the first week after its March 29 launch. Warner Bros. Discovery said CNN content will be a key component of its streaming offerings going forward.

When it was owned by AT&T, CNN spent hundreds of millions of dollars to program and market the product, which executives described as the news organization’s most ambitious new venture since the founding of the network more than 40 years ago.

Zaslav, who wasn’t allowed to make management decisions at the business until the deal closed, has promised at least $3 billion in cost savings as a result of the merger.

Shares of Warner Bros. Discovery fell as much as 8.7% to $21.01 in New York, in part over continuing skepticism about the future of streaming following Netflix Inc.’s surprise subscriber decline this week.

CANADA

Temperatures over 40 Celcius, longer heatwaves: report offers advice to adapt

Grand Bend Beach in Lambton Shores. July 4, 2020. (Screenshot from the Grand Bend Beach cam)

By Adelle LoisellApril 20, 2022 

Unless governments, communities, property managers, and individual Canadians act, a new report by researchers at the University of Waterloo suggests heat-related deaths in Canada will double by 2080.

That’s under its best-case scenario. Under its worst, it predicts those deaths will increase by 450 per cent over rates from the last half-century.

The report stresses governments need to recognize extreme heat events as natural disasters the same way it classifies flooding and wildfires. It says 17-million Canadians living in cities and towns are vulnerable, and Southwestern Ontario should anticipate some of the worst impacts.

In Windsor, “Irreversible Extreme Heat: Protecting Canadians and Communities from a Lethal Future” suggests between 2051 and 2080, the number of extreme heat days, those with temperatures over 30 Celcius, could increase from the current 23 to 79 days a year under a high carbon model. Maximum temperatures will jump to 40 degrees, and the duration of heatwaves could be 9.8 days.

In comparison, between 1976 and 2005, Windsor’s maximum temperature was 35 Celcius on average, and heat waves typically lasted four days maximum.

London could anticipate 61 days a year with temperatures over 30 Celcius and heat waves that last eight days.

The report did not provide projections for Chatham-Kent, Sarnia, or Leamington but did say those communities are also at risk.

Pavement on Hwy 3 in Tecumseh buckles in heat on July 15, 2018. Photo courtesy Gary McNamara/Twitter.

Not only are lives and the healthcare system at stake, but infrastructure like roads, railways, and bridges could fail in extreme temperatures while failing crops threaten food security. It also suggested cities that suffer the worst heat could see more crime as mental health and the economy suffer.

While air conditioning has helped Canadians weather the worst impacts of heat so far, it may offer less benefit in the years to come because it requires electricity. As demand grows during hot days, greenhouse gas emissions rise, and power grids could fail.

However, the Intact Centre for Climate Adaptation also said Canadians are not helpless in the face of rising temperatures. It points out that heat-related deaths are preventable, and adaptation is possible.

There is no doubt the document offers some dire predictions for the next six decades. It also recommends actions individual Canadians, property owners, and communities can take. Some have already started to adapt.

Individual Canadians might consider using ceiling and portable fans more, improving home insulation, installing window coverings like shutters, and modifying living, working, and sleeping arrangements.

30 maple trees were planted as part of the Diamond Project in Durham. (Photo courtesy of the Diamond Project via Facebook)

Both individuals and communities can plant more trees, but cities and towns are encouraged to promote green roofs and building facades. Property managers can prompt apartment dwellers to create balcony gardens.

Municipalities can develop extreme heat emergency plans, extend opening hours at beaches, public pools, water parks, and cooling centres, and offer free public transportation to those locations that offer residents respite. Patrols could check on residents in disadvantaged neighbourhoods, and flexible hours might keep outside workers safe.

These B.C. cities will get hit hardest by future heat waves

The B.C. Interior cities of Kelowna, Kamloops, Penticton, Creston and Vernon are expected to face some of the hottest and long-lasting heat waves starting in 2051. A lack of preparedness, however, still leaves the big cities of Metro Vancouver vulnerable.

Stefan Labbé
a day ago

Heat-buckled concrete in Kelowna.Jeremy Spurway via Castanet

Kelowna is projected to face the longest-lasting heat waves and the hottest maximum temperatures of any major Canadian city, a new report says. 

The report, published Wednesday from the Intact Centre on Climate Adaptation, outlines several measures tenants, landlords and communities can take to prepare for the fallout from extreme heat. 

Modelling heat waves between 2051 and 2080, the researchers found Kelowna will become among the top 10 “hottest” metropolitan areas in Canada.

Smaller Interior communities like Kamloops, Penticton, Creston and Vernon are also expected to reach similar temperatures. 

In another metric, Windsor, Ont., is expected to have the most number of very hot days with an average of 78.8 days over 30 C under high-emission scenarios. In that field, Kelowna came in fourth after three other southern Ontario cities. 

The top 10 metropolitan areas based on projections for warmest maximum temperature and the average length of heat waves until 2080. Irreversible Extreme Heat: Protecting Canadians and Communities from a Lethal Future

Over 17 million urban Canadians are expected to face extreme heat in the coming years. The report also warns of “red zones” in low-lying areas in B.C., southern Prairies, the St. Lawrence River valley in Quebec, and regions north of Lake Erie in Ontario.

Whereas flooding and wildfire — expected to increase in frequency and intensity this century — will cost Canada vast sums of money,  heat waves will ramp up as a kind of silent killer.

“The impacts of heat are death,” said lead author Joanna Eyquem, managing director of Climate Resilient Infrastructure at the centre.

The parts of the country expected to be hit with the hottest heat for the longest aren’t always the most vulnerable. Heat waves that occur outside of the summer or in communities unaccustomed to extreme heat can face massive human casualties, as was seen in Metro Vancouver last summer when nearly hundreds died alone in hot, poorly ventilated rooms. 

Eyquem called on all levels of government to start taking extreme heat more seriously.

After last year’s heat wave in B.C., Eyquem said she expected to see a growing recognition of heat’s deadly potential. But when she looked at Canada’s federal disaster database, it still failed to mention the disaster. 

On a Health Canada webpage outlining its role in a disaster, Eyquem said the agency did not include extreme heat among other risks like earthquakes, floods and outbreaks of disease.

“It’s not seen as an emergency,” she said.

To date, local governments have largely been left on their own to deal with extreme heat — whether creating cooling centres or deploying misting fountains. But as the COVID-19 pandemic has shown, provincial and federal governments play key roles providing funding, coordinating action plans and delivering messages. 

In the interim, an individual who chooses to adapt their home to extreme heat also makes life more comfortable and affordable at the same time. 

And while the report doesn’t specifically target Indigenous communities or the acute challenges of Canada’s North, Eyquem says it offers a baseline for action at the local level.

“There are simple things, even just sticking up some window films to kind of cut the sun coming through your windows,” she said. 

“That's very affordable. So I don't know why we're not doing that.” 

This ‘silent killer’ of climate change may hit 17 million Canadians the hardest. Here’s what a new report suggests as protection

APRIL 20, 2022

It’s floods that lead to repairs costing billions of dollars. It’s fires that burn images of charred buildings and communities into our minds.

But of all the extreme weather events made more likely by climate change, it’s another — extreme heat — that is the deadliest. And a new report by Canadian experts on climate adaptation says there are clear ways to make sure fewer Canadians die of extreme heat in the future.

Without action, the picture painted by a report on irreversible extreme heat from the Intact Center on Climate Adaptation — a University of Waterloo climate adaptation research center — is dire. The documentwhich is meant to instruct individuals, communities and higher levels of government in Canada to prepare for and avoid the worst effects of extreme heat, concluded that 17 million Canadians — including the population of Toronto — live in metropolitan areas that the report’s authors regard as at highest risk for extreme heat events.

In the best case scenario, with lower carbon emissions and stable population, the frequency and severity of extreme heat events until 2080 will mean 50 per cent more people are expected to die compared to the past 50 years for heat-related reasons.

In the worst case scenario — high carbon emissions and large population growth — the rate of excess deaths could be 450 per cent greater than in the last 50 years.

Joanna Eyquem, managing director of climate-resilient infrastructure at the Intact Center and the lead author of the report, said the high death toll from extreme heat — most recently highlighted by the heat dome in British Columbia that claimed 526 lives in eight days last year — make it apparent why adaptations to extreme heat events are urgently needed. Extreme heat, the report states, is the “silent killer” of climate change — and is avoidable.

“Heat-related deaths are avoidable, with the right action, information and adaptation,” Eyquem told the Star. “That’s something we can avoid.”

It’s not that Canadians have not been exposed to extreme heat before, and suddenly will be. Item explains that instances of extreme heat, usually defined as temperatures above 30 Care already more common as a result of climate change, and are likely only to become more common.

That has direct effects on our health, such as by causing heat stroke in people who can’t avoid the heat, and indirect effects, such as by exacerbating mental-health issues and keeping people indoors and alone.

And heat does not strike equally everywhere. The effects of extreme heat are much worse in urban environments, where concrete absorbs heat and fewer trees and plants are present to cast shade and retain cooling water.

“Not only are (artificial city) surfaces hotter during the day because they absorb all that solar heat, they give it out at night so we don’t get this cooling effect overnight,” she said. “That’s what we call this heat-island effect in cities.”

According to the report, urban environments can be 10 to 15 degrees hotter than rural areas on the same day for these reasons.

Older people, people with chronic conditions and people who live far away from green spaces are the most likely to be affected.

Fifteen metropolitan areas were identified as most at-risk for extreme heat in the future: Kelowna, Lethbridge, Regina, Saskatoon, Winnipeg, Windsor, Hamilton, Niagara Falls/St. Catharines, Brantford, London, Ottawa, Toronto, Belleville, Kingston and Montreal. A total of 17 million Canadians lived in these communities, per 2020 Statistics Canada estimates.


The Intact Centre, which consulted 60 experts for its guidance report, came up with 35 recommendations for tackling effects and deaths from extreme heat. It said that even with extreme heat events becoming much more common, deaths may not rise as much if these adaptations take place.

For individuals, the central recommendation is to make a plan for extreme heat in the way they might already have a fire or an earthquake plan. The plan would include noting any vulnerable family members you should check on in person during extreme heat, and identifying a cooling place you can go if your home is not adequately cool.

The report also recommends coming up with ways to passively cool your home if possible, such as with reflective window coverings or increasing plant areas.

The recommendations for property owners and managers also include coming up with an extreme heat plan, as well as playing a more active role in increasing green infrastructure such as trees on their properties, and maintaining designated air-conditioned cool rooms.

Communities are also encouraged to increase tree cover and vegetated areas, as well as to map which areas in the community are most vulnerable to extreme heat, prepare for extreme heat warnings, and provide incentives for owners and tenants to implement shaded areas.

Eyquem said it may not be intuitive for all Canadians to think about extreme heat, especially before the summer has started. But that’s exactly what she thinks we should do: Start thinking of heat as a climate disaster to prepare for in advance.

“I think in Canada we still have a cold climate mentality, we’re more worried about heating than cooling,” she said. “But that’s going to shift in the future. We’re warming twice as fast as the rest of the world.”

And, she said, heat is a good example of how climate change is not only an issue with carbon emissions and preventing environmental disaster.

“It’s framed as an environment issue,” she said. “But really it’s a health issue. There’s a lack of awareness that this is going to be important going forward for our health.”

Alex McKeen is a Vancouver-based reporter for the Star. Follow her on Twitter: @alex_mckeen

 

Ottawa struggled to block unvaccinated from accessing EI benefits: documents

By Staff  The Canadian Press

Posted April 21, 2022 11:58 am

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The employment insurance section of the Government of Canada website is shown on a laptop in Toronto on April 4, 2020. Internal government documents show that the Liberals' pledge to prevent unvaccinated people from accessing jobless benefits didn't eliminate all avenues for them to enter the EI system. Jesse Johnston/The Canadian Press file photo

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Internal government documents show that the Liberals’ pledge to prevent unvaccinated people from accessing jobless benefits didn’t eliminate all avenues for them to enter the employment insurance system.

The briefing notes prepared for Employment Minister Carla Qualtrough say that unvaccinated workers could qualify for EI sickness benefits, even if they are sick with COVID-19.

The laws guiding the social safety net program don’t have any explicit rules around eligibility for EI for anyone who refused to get vaccinated.

7:24Disobeying clear vaccine policies seen as noncompliance in EI claims: Qualtrough

Disobeying clear vaccine policies seen as noncompliance in EI claims: Qualtrough – Oct 24, 2021

While Qualtrough was told the government could put rules around regular jobless benefits, officials suggested the same couldn’t be said of sickness benefits.

Documents prepared by Qualtrough’s department last fall suggest officials advised against preventing access to sickness benefits and removing an incentive for ill workers to stay home with symptoms.

The details are contained in documents obtained by The Canadian Press under the Access to Information Act that outline some of the moves inside government as officials readied for a wave of layoffs for workers who refused to get vaccinated.

RENTIER CAPITALISM

Toronto's new wealth gap is driven by real estate, not income | The Star

Date: 2022-04-16 

When Giulio and Antonia Cescato bought a brand-new, modestly sized condo-townhouse in downtown Toronto in January 2015 they paid just under $600,000.

They made $150,000 at the time, a combined salary that, along with equity from Giulio’s condo, allowed them to put down a 20 per cent deposit.

The two-bedroom home at Dundas and Sumach streets that they share with their six-year-old son, Gabriel, is near schools, transit, grocery stores, daycares, barbershops, banks and restaurants. Their payments right now leave enough room to splurge once in a while, and take the “occasional vacation,” without feeling stretched.

They had wanted to upsize eventually, but even with the increased value of their home, re-entering the housing market at the current sky-high prices would leave them “mortgage poor.”

“Even if the bank was to give us a mortgage, it doesn’t seem sustainable in our minds to take on that much debt,” Giulio, 42, said.

By today’s standards, the Cescatos are lucky. They were able to buy their house when the average cost of home was about $620,000. This year to date the average is $1.3 million.

The high cost of real estate has led to a widening wealth gap threatening individuals’ security and the long-term prosperity of the GTA — a divide not based on income, but on when and if you were able to buy into the real estate market.

That difference determines more than if a family scrapes by, scrounging for rent or mortgage payments, or whether it can comfortably cover its housing costs, and afford restaurants and vacations.

It also impacts the biggest life decisions, says University of British Columbia professor Paul Kershaw — whether to move out of your parents’ home; live with a partner; have children.

On Monday, federal Finance Minister Chrystia Freeland called Canada’s housing affordability challenge an “intergenerational injustice.”

“We cannot have a Canada where the rising generation is shut out of the dream of home ownership,” she said, referencing her government’s budget measures to increase housing supply and affordability.

It was an acknowledgment of how, in less than a generation, buying a home has gone from a financially challenging but relatively common milestone, to a pipe dream for many people, especially those without family wealth. The fevered housing market of the pandemic has only exacerbated those challenges.

Ontario home prices are 22.5 times the average disposable income, up from 12.1 in 2010, and 9.7 in 2005, according to a report from Oxford Economics released by Mortgage Professionals Canada in March.

“Maybe not 10 years ago, but 15 years ago, if you grew up in Toronto and you were fortunate to get a good education and get a good job, you could buy a house and you could live in a neighbourhood either where you grew up or in another neighbourhood of your choice,” says University of Toronto professor Matti Siemiatycki.

Now the tension between what people earn and the price of a home is pulling at the fabric of the city.

“People who grew up here can’t live in the neighbourhoods they grew up in anymore. They can’t afford to buy and often can’t afford to rent either,” he said.

The gentrifying of neighbourhoods risks “severing deep meaningful social ties as people hustle to make ends meet,” said Siemiatycki, citing soul-sapping commutes and “painful decisions to leave a place that they often love and call home.

“If young families and workers can no longer afford to live in Toronto or people feel precarious in their place here, the city risks losing the work and dynamism they contribute,” he said.

It also cements inequality within generational cohorts, says Kershaw, a founder of Generation Squeeze, a group that advocates for intergenerational equality, noting there is an entire swathe of people who don’t have access to wealth.

About a quarter of older Canadians are not homeowners, said Kershaw. That means their family members can’t rely on intergenerational wealth for housing assistance.

---

Canadians have one of the world’s highest rates of home ownership. In 2016, 67.8 per cent of Canadian households owned their dwelling. In Toronto it was 53 per cent.

New census data won’t be available until summer, but the most recent statistics suggest home ownership is down among younger people. The 2016 Census showed half of millennials owned a home at age 30, compared to 55 per cent of baby boomers who owned at that age.

And the trend seems to be more prominent in Toronto. The 2018 Housing Survey by Statistics Canada found while half of first-time homebuyers nationally were under the age of 35, only 41.2 per cent of first-time buyers in Toronto were under 35.

Toronto couple Karan Kumra, 33, and fiancée Erin Prisciak, 32, have given up vacations and live frugally in order to the make the mortgage payments on the upper Beach semi they bought late last year for just over $1 million.

The couple — who have a combined salary of $150,000 — say they wouldn’t have been able to enter the market if it weren’t for sizable help from family.

Prisciak, a radiation therapist, said for her, with $50,000 in student loan debt after graduating, buying a house in Toronto was “never an option.”

The couple were only able to purchase because of a gift of $250,000 from Kumra’s parents. That reduced their mortgage to around $805,000, which still means $3,000 a month in payments.

“We pretty much can’t plan trips outside the country, or we’ll fall behind on our mortgage. So, we do small trips in Ontario and maybe later we’ll get to other parts of Canada,” said Kumra, an entrepreneur who manages retail operations for a cannabis outlet in Toronto.

They’re thankful for being able to buy their home, which they view as a retirement asset.

“We’re very privileged, very lucky … to have that kind of assistance from family. We’re absolutely thrilled that we got in when we did because (the market) is getting (more expensive),” Kumra said.

That kind of gift isn’t the reality for most first-time home buyers. Ipsos research for the Toronto Regional Real Estate Board found only 17 per cent of buyers were counting on gifts from family or friends. And while the proportion of buyers expecting family support has been consistent since 2015, the value of those gifts has grown along with “the meteoric rise of housing,” said Ipsos senior vice-president Sean Simpson.

“There’s no amount of hard work or pulling yourself up by your bootstraps that is going to help most people (get into the market),” added Prisciak. “If you don’t have some kind of wealth from family, I don’t think buying a house in Toronto is an option.”

Kershaw agrees.

“We’ve created an economy where full-time work in a reasonable period of time cannot secure housing. I don’t even mean home ownership — even access to a rental with enough bedrooms to have a family,” he said.

Kershaw calls himself a prime example. During his 17 years as a professor, he figures he’s paid about $500,000 into his defined contribution pension plan.

“Last year, while I was sleeping, my home went up by $500,000,” he said.

The impact is personal and public. In the hot real estate markets of Toronto and Vancouver, Kershaw said the high cost of housing will make it increasingly difficult to attract the best and brightest workers.

“Why would you want to come where your wage is going to buy you a fraction of the property? You’re pushing that 30- or early 40-year-old away from cities because they’re looking for space, they’re looking for the access to the ground to send their kids out to play,” he said.

While families moving further out of the city to smaller communities rejuvenates more affordable places, it also spreads the contagion of unaffordable housing and wealth inequality by driving up the prices there.

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For economist DT Cochrane, the Toronto region’s housing crisis isn’t a sudden, isolated problem — it is a symptom of an issue that has been brewing for years.

It is “maddening,” he said, that people have been talking about the wealth gap since long before the pandemic.

In the GTA, there are few social issues that better illustrate the growing divide between rich and poor than the lack of affordable housing.

And while governments and the housing industry mainly focus on a supply shortage, analysts and economists, including Cochrane, who works with Canadians for Tax Fairness, say the high cost of housing has to be viewed in the context of other factors including wages, pensions, interest rates and the commodification of homes.

If we ignore those issues, the wealth gap will only widen as people increasingly view housing as their retirement nest egg or an asset for a corporation.

“What’s happening in the housing market is going to turbocharge the process,” he said.

“Owning a house becomes an important source of leverage to then buy another house and another house. To go from owning one house to two houses is much easier than to go from owning zero houses to even one house.”

A 2020 report from the Toronto Region Board of Trade and WoodGreen Community Services found people earning $40,000 to $60,000 a year have been priced out of Toronto. Among them: personal support workers, grocery clerks, social workers, nurses and teachers.

Anyone who works in the city should be able to afford to live in the city, said Cochrane. “Otherwise, they’re just fly-in slaves.

“The fact that a teacher can’t afford to buy a house in Toronto should be really worrisome to the people of Toronto,” he said.

If more workers had union protection, stronger pensions and higher wages, people would be less reliant on rising home values for their financial futures, added Cochrane.

“We don’t think about corporations having obligations to their workers at all, whereas in the immediate postwar era there absolutely was that perspective.”

U of T professor Siemiatycki says it’s also important to put rising housing costs through the lens of inclusivity and diversity — who is able to buy into the market and who is excluded.

“We are running the risk of gentrification in some neighbourhoods that have really historic ties to racialized communities and continue to be hubs of those communities,” he said.

“If the market is just left to run wild, those communities have often had a very hard time buying in.”

Mike Moffatt, senior director of policy and innovation at the Smart Prosperity Institute, who also teaches at the Ivey Business School at Western University, adds that households could face another kind of crisis. He is among those who say it is possible home prices will eventually fall, although he won’t speculate on when that might happen.

If they do, he says, “There is a good chance we end up with the worst of both worlds where we have a significant enough correction to put people underwater (having a mortgage that’s higher than the value of your property), but prices are still so high that first-time homebuyers can’t get into the market.”

Moffatt fears it could take five to 15 years to sort out the region’s housing supply issue — which he believes is the main driver of unaffordability. Asked if that means an entire generation has been sacrificed, he says, many people have already been priced out for years.

“I do think there’s a problem,” he said.

“Most of my research associates are in their mid- to late 20s. They all feel like they’ll never be able to get a home. They’re not happy about it and I get where they’re coming from. I share the concerns.”

Meantime, says Kershaw, Canada’s aging population, which had better pensions, has the lowest rate of poverty and low income of any age group in the country.

“It’s not like today’s retirees are depending on housing but they do get accustomed to the extra wealth,” he said.

Kershaw says Canada has to think about how we build back better in terms of housing because we’re not as productive when it comes to output of work compared to other countries. Instead, our economy relies on real estate, rental and leasing which produces relatively few jobs.

“With low interest rates, Canadians have borrowed more money and bid it into the price of housing,” he said.

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Watching the struggles in the market, the Cescatos, who bought their townhome in 2015, are staying put — choosing not to stretch their finances in order to move up.

The couple say they’re fortunate they had the money for a decent down payment — “Which was all our free capital,” said Giulio, a planner with a firm in the city — and that their home had room for when their child came along.

They had hoped to parlay their unit into something larger, but that plan is “kind of laughable right now,” Giulio said. Even though the Cescatos earn larger salaries now and their unit has nearly doubled in value in the last five years, a move into a larger home isn’t in the cards because everything else on the market has soared too.

“Even a modestly priced house close to where we live now, we’d be looking into the couple million dollars range, if not more and tripling our mortgage,” Giulio said.

“The accountant in me says ‘absolutely not,’” added Antonia, 43.

So at this point they are looking at making improvements to their unit to make it their “forever home.”

“We have a European-style fridge, it’s small for a family. I had a friend who choked when she saw my refrigerator,” said Antonia. “So we might want to think about doing some kitchen renos down the road, to actually fit a full-sized refrigerator.”

Tess Kalinowski is a Toronto-based reporter covering real estate for the Star. Follow her on Twitter: @tesskalinowski

Donovan Vincent is a housing reporter based in Toronto. Follow him on Twitter: @donovanvincent